-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: keymaster@town.hall.org Originator-Key-Asymmetric: MFkwCgYEVQgBAQICAgADSwAwSAJBALeWW4xDV4i7+b6+UyPn5RtObb1cJ7VkACDq pKb9/DClgTKIm08lCfoilvi9Wl4SODbR1+1waHhiGmeZO8OdgLUCAwEAAQ== MIC-Info: RSA-MD5,RSA, aSHp6hfGOprug5PcGCxovEtVYCIndP0L5ajG/qeV2TNCwx9rVMhwPc0qjSYIrXe1 ASewr9YNNYHSWquAC1JbfQ== 0000950135-94-000195.txt : 19940324 0000950135-94-000195.hdr.sgml : 19940324 ACCESSION NUMBER: 0000950135-94-000195 CONFORMED SUBMISSION TYPE: DEF 14A PUBLIC DOCUMENT COUNT: 1 CONFORMED PERIOD OF REPORT: 19940422 FILED AS OF DATE: 19940323 FILER: COMPANY DATA: COMPANY CONFORMED NAME: NASHUA CORP CENTRAL INDEX KEY: 0000069680 STANDARD INDUSTRIAL CLASSIFICATION: 2670 IRS NUMBER: 020170100 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: DEF 14A SEC ACT: 34 SEC FILE NUMBER: 001-05492 FILM NUMBER: 94517363 BUSINESS ADDRESS: STREET 1: 44 FRANKLIN ST STREET 2: PO BOX 2002 CITY: NASHUA STATE: NH ZIP: 03061-2002 BUSINESS PHONE: 6038802323 MAIL ADDRESS: STREET 1: 44 FRANKLIN STREET STREET 2: P.O. BOX 2002 CITY: NASHUA STATE: NH ZIP: 03061-2002 DEF 14A 1 NOTICE & PROXY STATEMENT 1 SCHEDULE 14A INFORMATION PROXY STATEMENT PURSUANT TO SECTION 14(A) OF THE SECURITIES EXCHANGE ACT OF 1934 (AMENDMENT NO. ) Filed by the Registrant /X/ Filed by a Party other than the Registrant / / Check the appropriate box: / / Preliminary Proxy Statement /X/ Definitive Proxy Statement / / Definitive Additional Materials / / Soliciting Material Pursuant to sec.240.14a-11(c) or sec.240.14a-12 - -------------------------------------------------------------------------------- (Name of Registrant as Specified in Charter) - -------------------------------------------------------------------------------- (Name of Person(s) Filing Proxy Statement) Payment of Filing Fee (Check the appropriate box): /X/ $125 per Exchange Act Rules 0-11(c)(1)(ii), or 14a-6(i)(1), or 14a-6(j)(2). / / $500 per each party to the controversy pursuant to Exchange Act Rule 14a-6(i)(3). / / Fee computed on table below per Exchange Act Rules 14a-6(i)(4) and 0-11. (1) Title of each class of securities to which transaction applies: (2) Aggregate number of securities to which transaction applies: (3) Per unit price or other underlying value of transaction computed pursuant to Exchange Act Rule 0-11: (4) Proposed maximum aggregate value of transaction: Set forth the amount on which the filing fee is calculated and state how it was determined. / / Check box if any part of the fee is offset as provided by Exchange Act Rule 0-11(a)(2) and identify the filing for which the offsetting fee was paid previously. Identify the previous filing by registration statement number, or the Form or Schedule and the date of its filing. (1) Amount Previously Paid: (2) Form, Schedule or Registration Statement No.: (3) Filing Party: (4) Date Filed: 2 NASHUA CORPORATION 44 FRANKLIN STREET NASHUA, NEW HAMPSHIRE 03060 NOTICE OF ANNUAL MEETING OF STOCKHOLDERS TO BE HELD APRIL 22, 1994 Notice is hereby given that the Annual Meeting of Stockholders of Nashua Corporation will be held on the Eighth Floor of the Fleet Bank, 75 State Street, Boston, Massachusetts, on April 22, 1994 at 10:00 a.m., for the following purposes: 1. To elect a Board of Directors for the ensuing year. 2. To act upon any other business as may properly be brought before the meeting or any adjournment thereof. The Board of Directors has fixed the close of business on March 15, 1994, as the record date for determining the stockholders having the right to notice of and to vote at the meeting. PAUL BUFFUM Secretary March 21, 1994 IF YOU ARE ENTITLED TO VOTE AT THE MEETING, KINDLY EXECUTE AND MAIL THE ENCLOSED PROXY. 3 PROXY STATEMENT GENERAL The accompanying proxy is solicited on behalf of the Board of Directors of Nashua Corporation ("Nashua"), a Delaware corporation, whose principal executive offices are located at 44 Franklin Street, Nashua, New Hampshire 03060, for use at the annual meeting of the stockholders of Nashua to be held on April 22, 1994, and at any adjournment thereof. Each proxy executed and returned by a stockholder may be revoked by delivering written notice of such revocation to the Secretary of Nashua or by executing and delivering to the Secretary a proxy bearing a later date at any time at or before the meeting except as to any matters upon which, prior to such revocation, a vote shall have been cast pursuant to the authorization conferred by such proxy. This proxy statement is being mailed to stockholders on or about March 21, 1994. VOTING SECURITIES The only outstanding class of voting securities of Nashua is its common stock, each share of which entitles the holder thereof to one vote. Only stockholders of record at the close of business on March 15, 1994, are entitled to vote at the annual meeting and at any adjournment thereof. As of the close of business on such date, there were 6,321,950 shares of its common stock outstanding (excluding 24,610 shares held in Nashua's treasury). The holders of a majority of the issued and outstanding stock entitled to vote, present in person or by proxy, constitute a quorum for the transaction of business. NOMINEES FOR ELECTION AS DIRECTORS Pursuant to the bylaws of Nashua, the Board of Directors has fixed at ten the number of directors to be elected at the annual meeting. Nashua's directors are elected annually by the stockholders and hold office until successors are elected and qualified or until death, resignation or removal. It is expected that each proxy executed and returned by a stockholder will be voted for the election of the nominees for directors listed below, unless authority to do so is withheld. If, however, any nominee becomes unavailable (which is not now anticipated), the persons named as proxies may, in their discretion, vote for another nominee. Under Nashua's bylaws, the affirmative vote of the holders of a majority of the shares of Nashua's common stock entitled to vote held by stockholders present at the meeting in person or by proxy is required for the election of directors. It is believed that, under Delaware law, a vote that is withheld from a particular nominee will be treated as entitled to vote and present and thus have the effect of a negative vote. All of the nominees for directors named below are now directors of Nashua. 2 4 The business experience of each nominee for the last five years and the year he first became a director of Nashua are as follows:
DIRECTOR NAME AGE SINCE BUSINESS EXPERIENCE - ------------------------------ --- -------- ----------------------------------------------- Joseph A. Baute(a)(b) 66 1984 Mr. Baute was Chairman and Chief Executive Officer of Markem Corporation (information application systems) from prior to 1989 until his retirement in 1993. He is also a Director of Houghton-Mifflin Company, State Street Bank & Trust Company and Infosoft International. Richard E. Carter(b)(c) 65 1978(e) Private investor. Mr. Carter was President of Carter Offshore Design, Inc. (yacht design and marketing) until 1987. Charles E. Clough 63 1966 Mr. Clough has been Chairman and Chief Executive Officer of Nashua Corporation since prior to 1989. He was President from prior to 1989 until September 1993. He is also a Director of Pennichuck Corporation and Hitchiner Manufacturing Co., Inc. Thomas W. Eagar(c)(d) 44 1993 Professor Eagar has been Professor of Materials Engineering at Massachusetts Institute of Technology (MIT) since 1987 and POSCO Professor of Materials Engineering since 1993. He has also been a Co-Director of the Leaders for Manufacturing Program at MIT since 1993. Charles S. Hoppin(a)(d) 62 1979 Mr. Hoppin has been a partner in the law firm of Davis Polk & Wardwell since prior to 1989. John M. Kucharski(a)(b) 58 1988 Mr. Kucharski has been the Chairman, Chief Executive Officer and President of EG&G, Inc. (technical and scientific products and services) since prior to 1989. He is also a Director of New England Electric System, Eagle Industry Co., Ltd. and State Street Boston Corporation. William E. Mitchell 50 1993 Mr. Mitchell has been the President and Chief Operating Officer of Nashua Corporation since September 1, 1993. He was Senior Vice President, Electronics Sector, of Raychem Corporation from 1991 to 1993 and Senior Vice President, International and Industrial Sector, from 1989 to 1991. Mr. Mitchell is also a Director of Heraeus Surgical, Inc. and the American Electronics Association. Guy W. Nichols(a)(c) 68 1978 Mr. Nichols has been the Chairman of Woods Hole Oceanographic Institution since prior to 1989. He is also a Director of State Mutual Life Assurance Company of America, Allmerica Property & Casualty Companies, Inc. and Noble Affiliates Inc. James F. Orr III (b)(d) 51 1989 Mr. Orr has been Chairman, Chief Executive Officer and President of UNUM Corporation (insurance) since prior to 1989. He is also a Director of Grumman Corporation.
3 5
DIRECTOR NAME AGE SINCE BUSINESS EXPERIENCE - ------------------------------ --- -------- ----------------------------------------------- James Brian Quinn(c)(d) 66 1985 Professor Quinn has been the Buchanan Professor of Management (Emeritus), Amos Tuck School of Business Administration, Dartmouth College, and President of James Brian Quinn Associates (consultants) since prior to 1989. He is also a Director of Spectra, Inc. - --------------- (a) Member of the Audit Committee of Nashua's Board of Directors. (b) Member of the Executive Salary Committee of Nashua's Board of Directors. (c) Member of the Nominating Committee of Nashua's Board of Directors. (d) Member of the Pension Plan Review Committee of Nashua's Board of Directors. (e) Richard E. Carter was also a Director of Nashua from 1958 until 1975.
BOARD OF DIRECTORS COMMITTEES Included among the committees of the Board of Directors are standing Audit, Executive Salary and Nominating Committees. AUDIT COMMITTEE The Audit Committee approves the appointment of the independent accountants of the corporation, reviews with those accountants the annual audits of the corporation's consolidated financial statements and performs such other functions relating to the auditing of the corporation as the Committee or the Board may from time to time determine to be appropriate. The Audit Committee held two meetings in 1993. EXECUTIVE SALARY COMMITTEE The Executive Salary Committee reviews executive compensation, sets the Chairman's base salary and administers the Management Incentive Compensation Program, the Supplemental Compensation Plan and the corporation's stock option plans. The Executive Salary Committee held three meetings in 1993. NOMINATING COMMITTEE The Nominating Committee makes recommendations to the Board of Directors on the size and composition of the Board, policies involving terms and retirement of directors, candidates for election to the Board and certain other matters. The Nominating Committee will consider potential nominees for election to the Board of Directors recommended by any stockholder provided such recommendation is submitted in writing to the Secretary on or before November 21, 1994 for the 1995 annual meeting. The Nominating Committee held two meetings in 1993. BOARD OF DIRECTORS AND COMMITTEE MEETINGS During 1993 the Board of Directors held five regular meetings and two special meetings. Each of the directors attended at least 75% of the aggregate of (1) the total number of meetings of the Board of Directors held while he was a director and (2) the total number of meetings held by all committees of the Board on which he served. 4 6 COMPLIANCE WITH SECTION 16(A) OF THE EXCHANGE ACT Mr. Carter made a late filing on February 28, 1994 of a Form 5 annual report with respect to a certain exempt transaction in shares of Nashua common stock during 1993. The due date of this Form 5 was February 14, 1994. The reported transaction was a stock option grant on April 23, 1993. COMPENSATION OF DIRECTORS AND EXECUTIVE OFFICERS Directors of Nashua, except employees, receive $15,000 per year and $750 plus expenses for each Board meeting and Board committee meeting attended. Members of the Audit Committee receive an additional $1,750 annually. In addition, directors of Nashua who are not employees are each year awarded options to purchase 1,000 shares of common stock having an exercise price equal to the fair market value for such shares on date of award under the provisions of Nashua's 1993 Stock Incentive Plan. The following table sets forth the annual and long-term compensation paid to Nashua's five most highly compensated executive officers at December 31, 1993 and to Mr. Mitchell for services rendered to Nashua for the last three fiscal years: SUMMARY COMPENSATION TABLE
LONG-TERM COMPENSATION AWARDS ANNUAL COMPENSATION ------------- FISCAL ----------------------------- OPTIONS/SARS ALL OTHER NAME AND PRINCIPAL POSITION YEAR SALARY BONUS OTHER(1) (SHARES) COMPENSATION(2) - -------------------------------------- ------- -------- ----- -------- ------------- --------------- Charles E. Clough..................... 1993 $407,692 $ 0 $ 2,381 15,000 $ 130,185 Chairman of the Board and Chief 1992 $400,003 $ 0 $ 2,926 15,000 $ 123,484 Executive Officer 1991 $407,692 $ 0 $ 3,123 9,000 $ 116,334 William E. Mitchell................... 1993 $127,692(3) $ 0 $ 1,942 45,000 $ 3,528 President and Chief Operating 1992 -- -- -- -- -- Officer 1991 -- -- -- -- -- John G. Barnes........................ 1993 $224,991 $ 0 $ 1,063 3,600 $ 3,667 Vice President 1992 $216,242 $ 0 $ 698 3,600 $ 38,727 1991 $217,643 $ 0 $ 1,010 3,600 $ 36,327 John J. Montesi....................... 1993 $209,280 $ 0 $ 1,878 3,600 $ 3,763 Vice President 1992 $197,387 $ 0 $ 2,351 3,600 $ 44,872 1991 $200,000 $ 0 $ 2,507 3,600 $ 42,361 Joseph R. Kershaw..................... 1993 $204,703 $ 0 $ 1,216 3,600 $ 3,838 Vice President 1992 $193,112 $ 0 $ 1,406 3,600 $ 39,819 1991 $195,000 $ 0 $ 1,193 3,600 $ 37,931 William Luke.......................... 1993 $198,438 $ 0 $ 925 3,600 $ 26,238 Vice President -- Finance and Chief 1992 $191,761 $ 0 $ 1,913 3,600 $ 25,231 Financial Officer 1991 $192,338 $ 0 $ 915 3,600 $ 21,967 - --------------- (1) Tax equalization payments. (2) Includes amounts set aside under the Company's Supplemental Compensation Plan, Company contributions to the 401(k) Savings Plan and executive life insurance reimbursement income. In 1993, these amounts were (i) as to the Supplemental Compensation Plan -- Mr. Clough, $124,335 and Mr. Luke, $23,061; (ii) as to life insurance reimbursement income -- Mr. Clough, $3,350; Mr. Mitchell, $2,297; Mr. Barnes, $1,167; Mr. Montesi, $1,263; Mr. Kershaw, $1,338; and Mr. Luke, $677; and (iii) as to the
5 7 401(k) Savings Plan -- Mr. Clough, $2,500; Mr. Mitchell, $1,231; Mr. Barnes, $2,500; Mr. Montesi, $2,500; Mr. Kershaw, $2,500; and Mr. Luke, $2,500. (3) Mr. Mitchell joined Nashua in September 1993. His annual salary is $400,000. STOCK OPTIONS/STOCK APPRECIATION RIGHTS The following table sets forth certain information as to options/SARs granted during fiscal 1993 to the individuals listed in the Summary Compensation Table. In accordance with SEC rules, also shown are the hypothetical gains or "option spreads", on a pre-tax basis, that would exist for the respective options/SARs. These gains are based on assumed rates of annual compound stock price appreciation of 5% and 10% from the date the options/SARs were granted over the full option term. To put this data into perspective, the resulting stock prices for the grants expiring on March 6, 2003 would be $41.94 at a 5% rate of appreciation and $66.79 at a 10% rate of appreciation, and for the grant expiring on September 2, 2003, $49.27 at 5% and $78.46 at 10%. OPTION/SAR GRANTS IN FISCAL 1993
POTENTIAL REALIZABLE VALUE AT ASSUMED ANNUAL RATES OF STOCK PRICE APPRECIATION FOR % OF TOTAL OPTIONS/ EXERCISE OR OPTION/SAR TERM OPTIONS/SARS SARS GRANTED TO BASE PRICE EXPIRATION ----------------------------- NAME GRANTED(#) EMPLOYEES IN 1993 ($/SHARE) DATE 0% 5% 10% - --------------------- ------------- ------------------- ----------- ---------- --- -------- ---------- Charles E. Clough.... 15,000(1) 14.2% $ 25.75 3/6/2003 $ 0 $242,911 $ 615,583 William E. Mitchell........... 45,000(2) 42.5% $ 30.25 9/2/2003 $ 0 $856,083 $2,169,482 John G. Barnes....... 3,600(1) 3.4% $ 25.75 3/6/2003 $ 0 $ 58,299 $ 147,740 John J. Montesi...... 3,600(1) 3.4% $ 25.75 3/6/2003 $ 0 $ 58,299 $ 147,740 Joseph R. Kershaw.... 3,600(1) 3.4% $ 25.75 3/6/2003 $ 0 $ 58,299 $ 147,740 William Luke......... 3,600(1) 3.4% $ 25.75 3/6/2003 $ 0 $ 58,299 $ 147,740 - --------------- (1) These options became exercisable one year after grant, on March 5, 1994. (2) These options become exercisable in three equal installments -- 15,000 on September 1, 1995, 15,000 on September 1, 1997 and 15,000 on September 1, 1999.
The following table sets forth information as to options/SARs exercised in 1993 and unexercised options/SARs held at the end of fiscal 1993, by the individuals listed in the Summary Compensation Table: OPTION EXERCISES IN FISCAL YEAR 1993 AND VALUE OF OPTIONS/SARS AT END OF FISCAL 1993
NUMBER OF UNEXERCISED VALUE OF UNEXERCISED, OPTIONS/SARS HELD AT IN-THE-MONEY, OPTIONS/ FISCAL YEAR END SARS AT FISCAL YEAR END(2) SHARES ACQUIRED VALUE ---------------------------- ---------------------------- NAME ON EXERCISE REALIZED(1) EXERCISABLE UNEXERCISABLE EXERCISABLE UNEXERCISABLE - --------------------------- --------------- ----------- ----------- ------------- ----------- ------------- Charles E. Clough.......... 0 0 99,000 15,000 $ 121,875 $26,250 William E. Mitchell........ 0 0 0 45,000 0 0 John G. Barnes............. 0 0 37,200 3,600 $ 48,750 $ 6,300 John J. Montesi............ 0 0 45,200 3,600 $ 166,500 $ 6,300 Joseph R. Kershaw.......... 2,440 $34,465 45,200 3,600 $ 166,500 $ 6,300 William Luke............... 0 0 37,200 3,600 $ 48,750 $ 6,300 - --------------- (1) Represents the difference between the closing price on the New York Stock Exchange of Nashua's common stock on the date of exercise ($26.125) and the exercise price of the options.
6 8 (2) Represents the difference between the closing price on the New York Stock Exchange of Nashua's common stock on December 31, 1993 ($27.50) and the exercise price of the options/SARs. PENSION PLAN The following table shows estimated annual benefits payable upon retirement under the Nashua Corporation Retirement Plan for Salaried Employees, which includes the individuals listed in the Summary Compensation table: ESTIMATED PENSION BENEFITS
AVERAGE ANNUAL YEARS OF SERVICE COMPENSATION FROM -------------------------------------------------------------- JANUARY 1, 1990 25 OR TO RETIREMENT 5 YEARS 10 YEARS 15 YEARS 20 YEARS MORE YEARS - ------------------ -------- -------- -------- -------- ---------- $ 125,000 $ 13,750 $ 27,500 $ 41,250 $ 55,000 $ 68,750 250,000 27,500 55,000 82,500 110,000 137,500 375,000 41,250 82,500 123,750 165,000 206,250 500,000 55,000 110,000 165,000 220,000 275,000 625,000 68,750 137,500 206,250 275,000 343,750 750,000 82,500 165,000 247,500 330,000 412,500 875,000 96,250 192,500 288,750 385,000 481,250 1,000,000 110,000 220,000 330,000 440,000 550,000
Compensation covered by this plan generally refers to total annual cash compensation, including salary and bonus, but excluding certain items such as the value of stock option awards and employer allocations to the Supplemental Compensation Plan and 401(k) Savings Plan. As of December 31, 1993, the individuals named in the Summary Compensation Table had the following years of service credited under the plan: Mr. Clough, 33 years; Mr. Mitchell, 0 years; Mr. Barnes, 9 years; Mr. Montesi, 29 years; Mr. Kershaw, 30 years; and Mr. Luke, 10 years. The estimated annual benefits shown above are subject to an offset for 50% of a participant's primary Social Security benefit. Benefits as shown above, minus the 50% offset for social security benefit, are available for participants whose pensions start after reaching age 65. Participants who have five or more years of service are eligible to receive pensions after reaching age 60 and participants who have ten or more years of service are eligible to receive pensions after reaching age 55, but payments are reduced 4.2% per year for each year that they start receiving benefits earlier than at age 65. Payments are further reduced for participants whose credited service began before age 40 and terminate employment with Nashua prior to reaching age 55. The Employee Retirement Income Security Act of 1974 places limitations on pensions which may be paid under plans qualified under the Internal Revenue Code. Amounts exceeding such limitations may be paid outside of qualified plans. Nashua has a Supplemental Unfunded Excess Retirement Benefit Plan providing for such amounts for its employees including the six executives named in the compensation table. SEVERANCE AGREEMENTS The Company has entered into severance agreements with Messrs. Clough, Mitchell, Barnes, Montesi, Kershaw and Luke in order to ensure their continued service to Nashua in the event of an attempt by a person or group of persons to gain control of Nashua. Such severance agreements provide that upon termination of employment under certain circumstances within three years of a "change in control" as defined in these agreements, the employee would receive severance pay equal to three times the sum of his annual salary and 7 9 bonus. In addition, if after one year following the "change in control" the executive elects to terminate employment, he would receive the above described severance pay. Additional payments are required in amounts such that after the payment of all taxes, the executive will be in the same after tax position as if no excise tax under Section 4999 of the Internal Revenue Code had been imposed. In addition, the agreements provide for the immediate vesting of deferred bonus awards upon such termination and the continuation for specified periods of certain other benefits. In the event that Mr. Mitchell's employment is terminated as a result of a decision by Nashua unrelated to any "change in control" which is involuntary on his part (other than for malfeasance), Nashua has agreed to provide Mr. Mitchell with 36 months of salary continuation commencing when such termination occurs. EXECUTIVE SALARY COMMITTEE REPORT The Executive Salary Committee is composed of the non-employee directors listed below. The Committee administers the Management Incentive Compensation Program, the Company's stock option plans and the Company's Supplemental Compensation Plan. Each year the Committee reviews the Chief Executive Officer's performance against objectives and sets the Chief Executive Officer's base salary. The Committee also reviews the performance and the salary levels of the other executives listed on the compensation table and makes decisions regarding the above plans and programs. The Committee's compensation policies applicable to the Chief Executive Officer and the other executives listed on the compensation table for 1993 are as follows: Base salaries should be at competitive levels so as to attract and retain well qualified executives. Executive base salaries are generally at or near the median base salaries for similar positions in companies with corporate sales ranging generally from $500 million to $1 billion based on survey data of 62 such companies from a national executive compensation consulting firm. None of the three companies listed in the photofinishing peer group with respect to the Company's performance graph were included in the survey. Mr. Clough's base salary was 114% of the median base salary for chief executive officers in such survey group. Incentive compensation paid in cash should be awarded to support company objectives based on company and division performance during the preceding year. The Company's Management Incentive Compensation Program provides that cash awards may be granted each year by the Committee based on corporate and division performance. For the Chief Executive Officer, Chief Operating Officer and Chief Financial Officer, award targets for 1993 were based on the Company's earnings per share. For other executive officers listed on the compensation table, award targets for 1993 were based on the Company's earnings per share and the earnings of the division for which they are responsible. No incentive compensation cash payments were authorized by the Committee to any of the officers listed on the compensation table with respect to 1993 since the predetermined corporate and relevant division targets had not been met. Long-term equity-based compensation should be awarded to provide incentive to executives to create value for stockholders and give the executives a substantive ownership interest in the Company's success. The Committee believes stock option grants should be made annually on a generally consistent basis for approximately the same number of shares. A special grant of 45,000 options was awarded to Mr. Mitchell as part of his employment contract. The Committee does not consider the amount of Company stock or the amount and terms of stock options already held by any executive in making its determinations. Supplemental life insurance and supplemental retirement payments should be provided for key executives to assist in the attraction and retention of management. The Company's Supplemental 8 10 Compensation Plan provides for a death benefit after retirement of two times the participant's last annual base salary and a life insurance benefit before retirement of three times the participant's then current base salary, in lieu of the life insurance benefit of two times the participant's then current annual base salary plus bonus payable under the Company's general group life insurance policy. Under this Plan the Company also maintains an account for each participant to provide the participant with supplemental retirement payments. The participant is eligible to receive these payments upon retirement from Nashua Corporation after 5 years of service. Payment amounts will be determined by the value of his account at the time payments commence and prevailing market rates for annuities. The Committee approved the following additional amounts to be set aside for 1993 in the following executives' supplemental retirement accounts: Mr. Clough, $124,335 and Mr. Luke, $23,061. The Committee has not yet had occasion to adopt any policy on the new tax law disallowing deductions on compensation in excess of $1 million for certain executives of public companies. The Company believes that options granted under its stock option plans are exempt from the limitation and that other compensation expected to be paid during 1994 will be below the compensation limitation. Executive Salary Committee John M. Kucharski, Chairman Joseph A. Baute Richard E. Carter James F. Orr III COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION Messrs. Kucharski, Baute, Carter, Orr and Ronald J. Jackson (who was a director until April 23, 1993) served as members of the Executive Salary Committee during 1993. None of those individuals had any transactions or relationships with the Company, or "interlocking" or cross-Board memberships, in 1993 that are required to be disclosed under SEC rules, except that the Company purchases group life and disability insurance from UNUM Corporation, of which Mr. Orr is Chairman, Chief Executive Officer and President. The aggregate premiums paid by the Company to UNUM for this insurance in 1993 were $691,186. PERFORMANCE GRAPHS Set forth below is a line graph comparing the yearly percentage change in the cumulative total stockholder return on the Company's common stock against the cumulative total return of the S&P-500 Index and a composite peer group for the five years commencing December 31, 1988 and ending December 31, 1993. The Company selected a peer group because, having several distinct lines of business, it did not believe that published industry or line-of-business indexes provided an adequate measure for comparison of the Company as a whole. The Company has four distinct lines of business: coated products, photofinishing, computer products and office supplies. In constructing a composite peer group, the Company selected published indexes to represent three lines of business and, because no published photofinishing index was available, has selected a peer group for that segment. The three indexes are: for coated products, the S&P Paper and Forest Products Index; for computer products, the S&P Computer Systems Index; and for office supplies, the S&P Office Equipment & Supplies Index. As peer companies in the photofinishing segment the Company selected Eastman Kodak Company, Seattle Filmworks, Inc. and The Actava Group, Inc. and weighted them by market capitalization. The Company then weighted the three indexes and photofinishing peer group in proportion to the 1993 revenues of each of Nashua's respective four lines of business. 9 11
Measurement Period Nashua S&P 500 Composite (Fiscal Year Covered) Corporation Index Peer Group 1988 100 100 100 1989 98 132 104 1990 97 127 98 1991 67 166 121 1992 85 179 124 1993 84 197 147
SECURITY OWNERSHIP OF MANAGEMENT The following table shows the number of shares and percentage of Nashua's common stock deemed to be beneficially owned by each director and nominee for director, each executive officer named in the Summary Compensation Table above and by all directors and officers of Nashua as a group, as of March 15, 1994:
AMOUNT AND NATURE PERCENT OF OF BENEFICIAL SHARES NAME OWNERSHIP(a) OUTSTANDING ---- ----------------- ----------- John G. Barnes.............................................. 50,547(b)(i) * Joseph A. Baute............................................. 1,700(c) * Richard E. Carter........................................... 56,630(c) * Charles E. Clough........................................... 162,900(d)(i) 2.6 Thomas W. Eagar............................................. 1,100(c) * Charles S. Hoppin........................................... 3,000(c) * Joseph R. Kershaw........................................... 58,186(e)(i) * John M. Kucharski........................................... 2,300(c) * William Luke................................................ 44,185(f)(i) * William E. Mitchell......................................... 0 -- John J. Montesi............................................. 69,343(g)(i) 1.1 Guy W. Nichols.............................................. 6,000(c) * James F. Orr III............................................ 2,000(c) * James Brian Quinn........................................... 1,622(c) * Directors and Officers as a group (19 persons).............. 493,420(h)(i) 7.8 - --------------- *Less than 1%
10 12 (a) Information as to the interests of the respective nominees has been furnished in part by them. The inclusion of information concerning shares held by or for their wives or children or by corporations in which they have an interest does not constitute an admission by such nominees of beneficial ownership thereof. Unless otherwise indicated, all persons have sole voting and dispositive power as to all shares they are shown as owning. (b) Includes 34,800 shares Mr. Barnes has a right to acquire through the exercise of stock options prior to May 31, 1994. (c) Includes 1,000 shares each outside Director has a right to acquire through the exercise of stock options prior to May 31, 1994. (d) Includes 2,084 shares Mr. Clough holds as custodian for his children and 93,216 shares he has a right to acquire through the exercise of stock options prior to May 31, 1994. (e) Includes 48,800 shares Mr. Kershaw has a right to acquire through the exercise of stock options prior to May 31, 1994. (f) Includes 40,800 shares Mr. Luke has a right to acquire through the exercise of stock options prior to May 31, 1994. (g) Includes 48,800 shares Mr. Montesi has a right to acquire through the exercise of stock options prior to May 31, 1994. (h) Includes 303,700 shares which the directors and officers of Nashua have the right to acquire through exercises of stock options prior to May 31, 1994. (i) Includes shares held in trust under the Employee's Savings Plan under which the participating employee has voting power as to the shares in his account. As of December 31, 1993, 2,318 such shares are held in trust for Mr. Clough's account, 1,747 shares are held in trust for Mr. Barnes account, 1,807 shares are held in trust for Mr. Montesi's account, 1,546 shares are held in trust for Mr. Kershaw's account, 608 shares are held in trust for Mr. Luke's account and 11,325 shares are held in trust for the accounts of all directors and officers as a group. No director other than Mr. Clough and Mr. Mitchell participates in the Plan. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS The following table shows the number of shares and percentage of Nashua's common stock beneficially owned by all persons known to Nashua to be the beneficial owners of more than 5% of its common stock, as of March 15, 1994:
AMOUNT AND NATURE PERCENT OF OF BENEFICIAL COMMON STOCK NAME OF BENEFICIAL OWNER OWNERSHIP OUTSTANDING - ----------------------------------------------------------------------------------- ------------ GAMCO Investors, Inc./Gabelli Funds, Inc./Gabelli Performance Partnership/Gabelli International Limited(a).................... 628,300(b) 9.94% 655 Third Avenue, New York, NY 10017 President and Fellows of Harvard College/Harvard Yenching Institute(c).................................................... 316,700(d) 5.01% 600 Atlantic Avenue, Boston, MA 02210 - --------------- (a) Information is based on a joint Schedule 13D (Amendment No. 4) dated July 20, 1992, furnished by such beneficial owners, which are affiliated with one another. (b) GAMCO Investors, Inc. owns 318,300 shares, for which it has sole dispositive power. It has sole voting power with respect to 278,300 of these shares. Gabelli Funds, Inc. owns 288,000 shares for which it has
11 13 shared dispositive power and shared voting power. Gabelli Performance Partnership owns 15,000 shares for which it has sole dispositive power and sole voting power. Gabelli International Limited owns 7,000 shares for which it has sole voting and sole dispositive power. (c) Information is based on Schedule 13G dated February 11, 1994, furnished by such beneficial owners, which are affiliated with one another. (d) President and Fellows of Harvard College owns 309,800 shares, for which it has sole voting and dispositive power. Harvard Yenching Institute owns 6,900 shares, for which it has sole voting and dispositive power. INDEPENDENT ACCOUNTANTS Representatives of Price Waterhouse, Nashua's independent accountants, are expected to be present at the stockholders' meeting with the opportunity to make a statement if they desire to do so and are expected to be available to respond to appropriate questions. STOCKHOLDER PROPOSALS Any stockholder proposal which is to be included in the proxy materials for the 1995 annual meeting must be received by Nashua on or before November 21, 1994. Such proposals should be directed to Nashua Corporation, 44 Franklin Street, P.O. Box 2002, Nashua, New Hampshire 03061-2002, Attention: Suzanne L. Ansara, Assistant Secretary. MISCELLANEOUS The Board of Directors does not presently know of any other matters to be presented to the annual meeting. If any other matters are brought before the annual meeting, or any adjournment thereof, it is the intention of the persons named in the accompanying form of proxy to vote the proxies on such matters in accordance with their best judgment, pursuant to the discretionary authority granted by the proxy. The cost of solicitation of proxies will be borne by Nashua. In addition to the use of the mails, proxies may be solicited by officers and regular employees of Nashua, without extra compensation, by telephone or by other means of communication. Nashua will reimburse banks, brokers or other similar agents or fiduciaries for forwarding proxy material to beneficial owners of common stock. Nashua has also retained Morrow & Co. to aid in the solicitation of proxies by personal interview, or by telephone or by other means of communication. Nashua anticipates that the cost of such service will not exceed $5,000. Nashua will provide free of charge to any stockholder from whom a proxy is solicited pursuant to this proxy statement, upon written request from such stockholder, a copy of Nashua's annual report filed with the Securities and Exchange Commission on Form 10-K for Nashua's fiscal year ended December 31, 1993. Requests for such report should be directed to Nashua Corporation, 44 Franklin Street, P.O. Box 2002, Nashua, New Hampshire 03061-2002, Attention: Suzanne L. Ansara, Assistant Secretary. PAUL BUFFUM Secretary Nashua, New Hampshire March 21, 1994 12 14 PROXY NASHUA CORPORATION PROXY for Annual Meeting of Stockholders - April 22, 1994 THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS The undersigned hereby appoint(s) FRANCIS J. LUNGER, WILLIAM LUKE and PAUL BUFFUM and each of them attorneys or attorney of the undersigned (with full power of substitution in them and in each of them), for and in the name(s) of the undersigned to vote and act at the annual meeting of the stockholders of Nashua Corporation, to be held at the Fleet Bank, 75 State Street, Boston, Massachusetts, on April 22, 1994 at 10:00 A.M., or any adjournment thereof, upon or in respect of all shares of stock of Nashua Corporation upon or in respect of which the undersigned would be entitled to vote or act, and with all the powers the undersigned would possess, if personally present, upon all matters which may properly come before said meeting, as described in the Proxy Statement and Notice dated March 21, 1994, receipt of which is hereby acknowledged. UNLESS A CONTRARY DIRECTION IS INDICATED, THIS PROXY WILL BE VOTED FOR ALL NOMINEES LISTED IN PROPOSAL 1 AS MORE SPECIFICALLY SET FORTH IN THE PROXY STATEMENT; IF SPECIFIC INSTRUCTIONS ARE INDICATED, THIS PROXY WILL BE VOTED IN ACCORDANCE THEREWITH. The Board of Directors recommends a vote FOR all nominees named in Proposal 1. In their discretion, the proxies are authorized to vote upon such other business as may properly come before the meeting or any adjournment thereof. CONTINUED, AND TO BE SIGNED, ON REVERSE SIDE - ---------------- SEE REVERSE SIDE - ---------------- /X/ Please mark votes as in this example. NOTE: Signature should be exactly as name appears on imprint. If stock is registered in the names of two or more persons as joint owners, trustees or otherwise, the proxy should be personally signed by each of them or accompanied by proof of authority of less than all to act. In the case of executors, administrators, trustees, guardians and attorneys, unless the stock is registered in their names, proof of authority should accompany this proxy. 1. Election of Directors. Nominees: Joseph A. Baute, Richard E. Carter, Charles E. Clough, Thomas W. Eagar, Charles S. Hoppin, John M. Kucharski, William E. Mitchell, Guy W. Nichols, James F. Orr III, James Brian Quinn. FOR WITHHELD / / / / / / - -------------------------------------- For all nominees except as noted above MARK HERE FOR ADDRESS / / CHANGE AND NOTE AT LEFT PLEASE FILL IN DATE, SIGN AND MAIL THIS PROXY IN THE ENCLOSED POST-PAID RETURN ENVELOPE. Signature: Date: ----------------------------- ----------------- Signature: Date: ----------------------------- ----------------- -----END PRIVACY-ENHANCED MESSAGE-----